Pension Tax Relief unchanged...for now?
There has been much talk and speculation in recent years on the subject of changes to tax relief on contributions to pensions. Providing some clarity to this, the Secretary of State for Work and Pensions, David Gauke, said at a conference in London on 4th July that he didn't see “a particular consensus emerging” for an overhaul of retirement savings incentives.
He added “The idea of reforming pensions tax relief in the previous parliament was somewhat daunting and recent events haven’t changed that.” He confirmed that there was a need to look at long term challenges with the cost of tax relief but wouldn’t see any fundamental changes in the near future.
This is not entirely surprising with the absence of a government with a strong majority; a pre-requisite for pushing through such a significant and potentially unpopular change.
Although this gives some reassurance, it must be borne in mind that government departments don't always talk to each other as much as you might imagine. Steve Webb, the Pensions Minister at the time of the announcement of the Pension Freedoms changes, admitted the first he knew about this was on the morning of Budget day when the changes were announced!
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